Bank of China to Expand Lending Services to Small Businesses

Bank of China has signed a strategic cooperation agreement with the All-China Federation of Industry and Commerce to further expand financing channels for private companies, especially small businesses, to expand their footprints globally.

“As part of BOC’s efforts to support private companies, the strategic cooperation will help the bank to improve its channels of communication with private small businesses, better understand the demand of its clients, and improve its financial services accordingly,” said Zhu Jun, general manager of the inclusive finance department at Bank of China.

Each of the bank’s branches will strengthen communication with local federations of industry and commerce, set aside an overall credit quota for small and microenterprises at the local level, deepen its knowledge of its clients’ businesses, and offer financial products specifically designed for private enterprises of different sizes.

BOC unveiled 20 measures to support private enterprises recently with the aim of stabilizing China’s foreign trade and domestic investment. These measures include optimizing the bank’s credit granting policy, reducing the cost of financial services, and expanding the scope of collateral.

Prior to that, regulatory authorities had urged banking and insurance institutions to step up financial support for private enterprises.

The regulator also encouraged banking institutions to reduce their reliance on collateral for lending to private companies, based on the enhancement of their abilities in risk identification and management.